In the second half of Al Jazeera’s Inside Story, the commentator asks Max Keiser in Paris what it would take to replace the U.S. dollar with an IMF managed global currency.
Keiser says, doing this would cause risks for the U.S., which has extraordinary privileges–writing checks that are never cashed since the U.S. just prints new dollars to pay the bills. This has been going on since the end of World War II.
Because of this, Max Keiser says, America has everything to lose and will resist China’s proposal to have a more stable global currency managed by the IMF.
He points out several instances of the U.S. using its military to solve these types of problems when another country wants out of the U.S. dollar.
Then Robert Scott in Washington D.C. was asked if this new global currency would work. He said the U.S. has the deepest financial markets in the world– about 40 trillion dollars making the dollar the currency of choice.
Andrew Leung said that a global currency managed by the IMF using SDRs would be more stable as a global currency. However, it is a bold vision that requires extraordinary political courage from Beijing. We can’t get there soon.
Back to Paris, Max Keiser gives an opinion that China doesn’t have enough gold to make this happen.
China has about 600 tons of gold while the U.S. has 8,000 tons. To be taken seriously, China would need to buy more gold and boost its reserves.
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